If your family includes young children, you’ve got lots to think about. You’ll need
to consider protecting your children if something should happen to either you or
your spouse, and you’ll need to pay special attention to their needs in case something
should happen to you both at the same time.
Consider these issues:
Living expenses for children.
As parents, you certainly know about the expenses
related to raising kids. Beginning with babies, it’s diapers, clothes, and baby
food. For older children it’s food and clothing – and they grow faster than you
would believe possible. For teenagers, more food and clothing bills are just the
beginning. So you know you must plan to provide for all of these basic expenses.
Childcare.
If your children are very young, you may also have daycare or
babysitting expenses. If you or your spouse become the single working parent, these
expenses are very likely to continue. Consider, too, any special needs your children
have. Children with disabilities may need extra financial support – a good way to
provide this level of support is to create a special needs trust into which life
insurance can be paid in the event of a parent’s death.
Activities.
Be sure to plan to cover the expenses related to activities your
kids participate in like sports, music lessons, etc.
Healthcare for kids.
Some healthcare expenses are not covered by insurance,
things like braces and glasses, for example. Consider purchasing supplementary health
insurance policies such as vision or dental insurance to cover these expenses. At
the same time, you may want to consider buying enough life insurance to cover these
sometimes-unexpected expenses.
Education.
This is certainly a significant expense for most families – especially
if your children attend private or parochial school. Annual increases in college
costs are running at less than 5%, but are still significant. So when you plan to
provide for education expenses, you’ll need to consider what the actual costs are
likely to be when your children are ready to attend private school or college.
Family events, transportation expenses and household support.
There are many
other expenses associated with raising a family. Celebrations – weddings, confirmations
and the like – are events that every family wants to enjoy to the fullest. Transportation
is another expense to prepare for, and you may also want to be sure your surviving
spouse can afford to replace the family vehicle when necessary. And you’ll need
to keep in mind the regular upkeep that a family home requires – maintenance like
painting, new windows, and other expenses. If your spouse is alone, be sure that
he or she has the financial capability to provide for the resources needed.